IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT, DIVISION FOUR

WORLD BUSINESS ACADEMY

Petitioner and Appellant,

v.

CALIFORNIA STATE LANDS COMMISSION, Defendant and Respondent, PACIFIC GAS & ELECTRIC COMPANY, Real Party in Interest and Respondent.

Court of Appeal No. B284300

(Superior Court No. BS163811)

Appeal from an Order

of the Superior Court, County of Los Angeles Hon. Mary H. Strobel

APPELLANT’S OPENING BRIEF

HUMPHREY & RIST, LLP *Christina A. Humphrey, Esq. (SBN 226326) Thomas A. Rist, Esq. (SBN 238090) The Granada Building 1216 State Street, 4th Floor, Suite 401 Santa Barbara, CA 93101 Telephone: (805) 618-2924 Facsimile: (805) 618-2939 Email: christina@humphreyrist.com Email: tom@humphreyrist.com

LAW OFFICES OF J. KIRK BOYD J. Kirk Boyd, Esq. (SBN 122759) 548 Market St., Suite 1300 San Francisco, CA 94104 Telephone: (415) 440-2500 Email: jkb@drjkb.com

Attorneys for Petitioner and Appellant, World Business Academy

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TABLE OF CONTENTS

I. INTRODUCTION AND SUMMARY OF APPEAL. ............ 8

II. STATEMENT OF FACTS. ................................................ 12

III. STATEMENT OF THE CASE. ......................................... 16

IV. ISSUES. ................................................................................ 16

V. SCOPE AND STANDARD OF REVIEW. ....................... 17

A. Appellate Review is De Novo. ...................................... 17

B. Judicial Review of Categorical Exemptions. .......... 18

VI. ARGUMENT. ....................................................................... 20

VII. THE STATE LANDS COMMISSION HAD A DUTY TO FOLLOW THE TWO PRONG TEST SET FORTH BY THE SUPREME COURT IN BERKELEY HILLSIDE AND FAILED TO DO SO. .................................................................... 20

VIII. THERE IS A “FAIR ARGUMENT” OF A REASONABLE POSSIBILTY OF A SIGNIFICANT EFFECT ON THE ENVIRONMENT FROM THE UNUSUAL CIRCUMSTANCES IN THIS CASE AND AN INITIAL STUDY MUST BE PREPARED BY THE COMMISSION. ... 32

A. There is a “Fair Argument” Based on Significant New Information About Earthquake Faults. .................... 34

B. There is a “Fair Argument” Based on Significant Changed Circumstances Due to Embrittlement. ............. 37

C. There Is a “Fair Argument” Based on Significant New Information About Cancer and Infant Mortality Around the Diablo Plant. ...................................................... 40

1. Increasing Rates of Cancer. ........................................ 40

4

2. Increasing Rates of Infant Mortality. ....................... 43

D. There is a “Fair Argument” Based on Significant New Information and Significant Changed Circumstance Regarding Marine Life Near Diablo. .................................. 46

E. There is a “Fair Argument” based upon Significant Changed Circumstances with Respect to the Size of the Diablo Plant. ............................................................................. 50

F. There is a “Fair Argument” Based on Significant New Information Regarding Tsunamis. ............................ 50

G. There is a “Fair Argument” Based on Significant New Information Regarding Risks from Both Cyber and Physical Attacks. ..................................................................... 51

H. There is a “Fair Argument” Based on Significant New Information and Significant Changed Circumstances Regarding Radioactive Waste. ................ 53

I. There is a “Fair Argument” Based on Significant Changed Circumstances Making Diablo the Sole Operating Nuclear Plant in California. ............................. 55

J. There is a “Fair Argument” Based on Significant Changed Circumstances Due to Criminal Charges against PG&E Resulting from the San Bruno Explosion… ............................................................................... 56

K. Each of the Ten Examples of “Fair Argument” is Sufficient for an Exception to the Exemption, and Considered in Combination, they Create an Overwhelming “Fair Argument” supporting an exception to the exemption. ................................................. 57

IX. THE APPLICATION OF A “BASELINE” DOES NOT NEGATE THAT THERE IS A “FAIR ARGUMENT”. ........... 57

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X. THE SECRETARY OF RESOURCES DID NOT INTEND TO INCLUDE NUCLEAR POWER PLANTS WITHIN THE EXEMPTION FOR “EXISTING STRUCTURES” BECAUSE A NUCLEAR POWER PLANT INHERENTLY HAS A SIGNIFICANT EFFECT ON THE ENVIRONMENT, BUT IF THE SECRETARY DID INTEND TO INCLUDE NUCLEAR POWER PLANTS, THEN HE LACKED THE AUTHORITY TO DO SO. ................................ 64

A. The Secretary of Resources Did Not Intend to Include Nuclear Power Generation Plants Within the “Existing Structures” Exemption. ....................................... 64

B. Even if the Secretary Intended Nuclear Plants to be Within the Exemption, such a Decision Would Be Invalid as an Abuse of Authority. ...................................................... 71

XI. THE TRIAL COURT DID NOT PROPERLY APPLY THE PUBLIC TRUST DOCTRINE. ......................................... 73 XII. CONCLUSION. ................................................................ 76

6

TABLE OF AUTHORITIES

CASES Azusa Land Reclamation Co. v. Main San Gabriel Basin

Watermaster (1997) 52 Cal.App.4th ............................................................................ 61

Baykeeper v State Lands Commission (2015) 242 Cal.App4th 202 .................................................................... 63

Berkeley Hillside Preservation Council v. City of Berkeley (2015) 60 Cal. 4th 1086 .................................................................... passim

Bloom v. McGurk (1994) 26 Cal.App.4th 1307.................................................................... 53

Citizens for East Shore Parks v. State Lands Com. (2011) 202 Cal.App. 4th .......................................................................... 54

County of Amador v. El Dorado County Water Agency (1999) 76 Cal.App.4th 931. ............................................................. 15, 61

Dehne v. County of Santa Clara (1981) 115 Cal.App.3d 827 ..................................................................... 61

Gentry v. City of Murrieta, (1995) 36 Cal.App. 4th 1359.................................................................... 28 Lighthouse Field Beach Rescue v. City of Santa Cruz (2002) 131 Cal.App.4th 1170................................................................... 33 Mountain Lion Foundation v. Fish & Game Com. (1997) 16 Cal.4th 105 ............................................................................. 61

7

Muzzy Ranch Co v. Solano County Airport Land Use Com. (2007) 41 Cal.4th 372 .............................................................................. 29

North Coast Rivers Alliance v. Westlands Water Dist. (2014) 227 Cal.App.4th 832.............................................................. passim

Pocket Protectors v. City of Sacramento (2004) 124 Cal.App. 4th 903, 930 ........................................................... 28

San Joaquin Raptor Rescue Center v. County of Stanislaus (1994) 27Cal.App4th 713, 722 ............................................................... 28

Save Our Big Trees v. City of Santa Cruz (2015) 241 Cal.App.4th 694..................................................................... 22

Save Our Carmel River v. Monterey Peninsula Water Management Dist. (2006) 141 Cal.App.4th 677 ......................................................... 60

Walters v. City of Redondo Beach (2016) 1 Cal.App.5th 809, 819-820 .................................................. 19, 29

Wildlife Alive v. Chickering (1976) 18 Cal. 3d 190 .............................................................................. 62

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I. INTRODUCTION AND SUMMARY OF APPEAL

The World Business Academy seeks environmental review

of Pacific Gas & Electric’s (“PG&E”) proposal to replace state

public trust land leases encompassing a portion of the water

cooling facilities for Diablo Canyon Nuclear Power Plant

(“Diablo”), which utilize a once-through cooling system using

offshore seawater as a coolant. This leased land is a prerequisite

for Diablo’s continued operation.1

On August 28, 1969, prior to the enactment of California’s

Environmental Quality Act (“CEQA”), the State Lands

Commission (“Commission”) authorized a 49-year lease (expiring

August 27, 2018) to PG&E for a portion of the cooling facilities

located on state land (Lease No. 4307.1 or “Unit 1”) and another

49-year lease on May 28, 1970, for the other portion of the cooling

facilities on state land that expires on May 31, 2019 (Lease No.

PRC 4449.1 or “Unit 2”).

On June 28, 2016, the Commission approved replacement of

the leases expiring on November 24, 2024 (Unit 1) and August 26,

1 Facts in this introduction are cited to the record post.

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2025 (Unit 2) without performing an Environmental Impact

Report (“EIR”) required under CEQA. In doing so, the Commission

determined that the project was categorically exempt under the

Class 1 exemption for existing facilities, without diligently

determining whether an “exception to the exemption” would apply.

In so doing, the Commission failed to follow the procedural

requirements of the two-prong test set forth in the Supreme

Court’s decision in Berkeley Hillside Preservation v. City of

Berkeley (2015) 60 Cal.4th 1086, 1092, that the Commission

determine first whether “unusual circumstances” exist, and

second, “whether there is a fair argument of a reasonable

possibility of a significant effect on the environment due to those

unusual circumstances.”

In Berkeley Hillside, the Court specifically held that the

CEQA statute and its implementing regulations, the CEQA

Guidelines, “prescribe review procedures a public agency must

follow before approving or carrying out certain projects.” Berkeley

Hillside, 60 Cal.App.4th at 1091-92. Despite this directive from the

Court, the Commission issued a one paragraph conclusory

statement with no analysis of whether there are “undue

circumstances” or “whether there is a fair argument of a

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reasonable possibility of a significant effect on the environment

due to those unusual circumstances.”

Instead, the Commission concluded that it did not have to

follow this two-prong analysis because PG&E had not changed

its existing operations, which they erroneously believe was

sufficient to displace the Berkeley Hillside analysis.

The trial court erred by following the Commission’s

misapplication of law with respect to the holding in North Coast

Rivers Alliance, et. al. v. Wetlands Water District, et. al. (2014)

227 Cal.App.4th 832, when it concluded that all the

environmental damage stemming from the continued operation

of the plant must be ignored because it is part of the existing

“baseline” of historical operations. While the trial court reversed

the Commission’s finding and correctly held that unusual

circumstances exist, the trial court incorrectly determined that

thirty plus years of continuous operations invalidates

Appellant’s compelling expert evidence that 1) continued

operation of the plant could result in a Fukushima type disaster,

2) a nuclear meltdown, 3) increased cancer and infant death

rates, 4) catastrophic loss of marine life, 5) risks from cyber and

terrorist attacks, and 6) accumulation and leakage of radioactive

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waste.

All this evidence was submitted in detail to both the

Commission and the trial court, and all of it was virtually

ignored. The Commission and trial court’s conclusions are

directly contrary to CEQA’s purpose of “[providing] long-term

protection to the environment” and the California Supreme

Court’s holdings and decision in Berkeley Hillside Preservation v.

City of Berkeley (2015) 60 Cal.4th 1086, 1092. There is no

question under the statute that further action was necessary

pursuant to CEQA.

The Commission and the trial court’s error in the first

place was to apply the existing facilities exemption at all.

Relying on administrative history and common sense, Appellants

argued that the Secretary of Natural Resources (“Secretary”)

never intended nor possessed the authority to exempt a facility

generating nuclear power because there is no question that it has

a significant effect on the environment. As noted in Berkeley

Hillside, supra, by statute, the Legislature directed the

Secretary to establish “a list of classes of projects that have been

determined not to have a significant effect on the environment

and that shall be exempt’ from CEQA.” Id. The cooling facilities

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at issue (or the desalinization plant or even the plant itself), have

never undergone an environmental review and could not possibly

fall within an exempt class because they operate as part of a

nuclear power plant, which clearly has a significant effect on the

environment. Truths such as these are self-evident.

As such, this Court is respectfully requested to reverse the

trial court’s judgment in the public interest and to remand this

case for issuance of a peremptory writ holding that an exemption

does not apply. Thereafter, the Commission must proceed with

an Initial Study to decide whether to issue a negative declaration

or prepare an environmental impact report. Alternatively, this

Court may remand the matter to the trial court with instructions

that the Commission apply the second-prong of Berkeley Hillside

and determine whether there is a fair argument regarding a

reasonable possibility of a significant effect on the environment

due to the unusual circumstances as held to exist by the trial

court.

II. STATEMENT OF FACTS

Two state land leases enabling operation of the cooling

water discharge channel, water intake structure, breakwaters, a

desalinization plant and associated infrastructure at the Diablo

13

Canyon Nuclear Plant (Diablo) are at the heart of this case.

These leases are a prerequisite for the continued operation of

Diablo, and without them, Diablo cannot function. The last

remaining nuclear plant in California, Diablo is located along the

Central Coast shoreline upwind from San Luis Obispo and

adjacent communities, in direct proximity to several major

earthquake faults.

As these two existing leases were scheduled to expire,

respectively, on August 27, 2018, and May 31, 2019, Pacific Gas

& Electric Company ("PG&E") sought new 7-year lease

extensions until November 24, 2024 (Unit 1) and August 26, 2025

(Unit 2).2

The issue before the Commission was whether PG&E,

whose initial leases were granted more than a decade prior to the

enactment of the California Environmental Quality Act

(“CEQA”),3 was entitled to an exemption from CEQA

environmental impact reporting requirements in relation to the

Commission's issuance of the new leases. Remarkably, an

Environmental Impact Report has never been prepared for

2 See, Vol. 4, Joint Appendix (hereafter “JA”), pp. 706-707. 3 California Health and Safety Code, Section 21000, et seq.

14

Diablo, despite numerous changing circumstances calling its

environmental security into question. At a hearing on December

18, 2015, on open record, Lieutenant Governor Gavin Newsom

stated his opinion that there is no exemption from CEQA for

Diablo, likening Diablo to offshore oil derricks that are subject to

CEQA reporting requirements when their leases are renewed.

His initial legal assessment was correct under prevailing law.

The February 9, 2016 staff report, prepared before any

political deal emerged, contains evidence showing that the

exemption did not apply. (See February 9 Staff Report, 4 JA 661-

666). Despite this assessment, on June 21, 2016, just one week

prior to the Commission's scheduled final hearing on the lease

application, PG&E announced a proposal under which it would

agree to retire the Diablo plant in 2025, if certain non-profit groups

agreed to forego challenges to its application for renewal of the

state land leases. In essence, PG&E requested an exemption from

CEQA in exchange for an agreement to close Diablo in 2025, the

expiration date of its license to operate under the federal Nuclear

Regulatory Commission (“NRC”).

Thereafter, on June 28, 2016, the Commission completely

reversed course from its previously stated inclination to apply

15

CEQA and officially approved Calendar Item 96, granting Diablo

a new lease until 2025 without any environmental review, on

grounds that the project was exempt from CEQA as an "existing"

facility.4 The Commission made no explanation on why the

exemption applied in direct contradiction to its prior staff report.

In its drastically revised report, Commission staff prepared

incomplete and cursory findings. For example, the findings did not

even mention, much less address, evidence in the record that

cancer rates and infant mortality are increasing in relation to

proximity and downwind location to the Plant. The report’s

summary findings merely concluded that an exemption as an

existing structure applied, negating application of CEQA, with

only a single boilerplate paragraph as an explanation for this

decision. In contrast to the Commission, which provided no

summary or analysis of its “substantial evidence,” Petitioners and

others submitted a broad range of substantial supporting evidence

to the Commission.

The Commission approved the exemption, despite the fact

that numerous attendees commenting at the June 28, 2016

meeting clearly demonstrated that the purported exemption did

4 See, 4 JA 687, 785-787; 5 JA 1128.

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not apply to cases, such as this one, where there is a reasonable

possibility that the activity will have a significant adverse

effect on the environment due to unusual circumstances.5

Appellant World Business Academy thereafter sought a

Writ of Mandate to require the Commission to make a finding,

as it was inclined to do earlier, that CEQA does apply and must

be followed.

III. STATEMENT OF THE CASE.

Following the timely filing of this mandamus action, the

record was prepared, and the case was briefed and argued. While

there are disputes regarding evidence admitted by the trial

court, there are no disputes about the content of the record which

was jointly filed. The Honorable Mary H. Strobel denied the

petition on July 11, 2017. (12 JA 288-2922 and 13 JA 2923-2941)

Appellant timely filed this appeal on August 8, 2017. (13 JA

3000-3002)

IV. ISSUES.

1) Did the State Lands Commission fail to proceed in the

5 See, 4 JA 981, 988, 990, 995, 1005-1006, 1011, 1017, 1033-1034, 1059; 6

JA 1321; 6 JA 1406-10; 8 JA 1769, 8 JA 1772-74. Also see, CEQA Guidelines Section 15300(c), which states: "[a] categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment."

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manner required by law when it approved the lease

replacements for the cooling facilities associated with Diablo

Canyon Nuclear Power Plant without following the two-prong

test set forth in Berkeley Hillside and failing to conduct adequate

CEQA review?

2) Did the State Lands Commission and the trial court err

by concluding that a nuclear power generation plant is included

within the exemption for “existing structures?”

V. SCOPE AND STANDARD OF REVIEW.

A. Appellate Review is De Novo.

In CEQA mandamus actions, “the trial and appellate

courts occupy in essence identical positions with regard to the

administrative record, exercising the appellate function of

determining whether the record is free from legal error.”

Bowman v. Petaluma (1986) 185 Cal.App.3d 1065, 1076. The

scope of this Court’s review of the certified record encompasses a

de novo determination of whether or not the State Lands

Commission prejudicially abused its discretion in approving the

replacement leases based on a categorical exemption from

CEQA.

While there are disputes regarding evidence admitted by

the trial court, there is no dispute about the contents of the

record which was jointly filed. Abuse of discretion will therefore

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be proven if the Court finds that the Commission did not proceed

in the manner required by law. (Code of Civil Procedure § 1094.5;

Pub. Resources Code § 21168.)

Public Resources Code section 21005 (a) provides that

“noncompliance with the information disclosure provisions” of

CEQA -- which includes whether or not an EIR is prepared --

results in a prejudicial abuse of discretion “regardless of whether

a different outcome would have resulted if the public agency had

complied with those provisions.” This holding as to irrelevance of

ultimate outcome has been underscored in a number of cases,

including County of Amador v. El Dorado County Water Agency

(1999) 76 Cal.App.4th 931, 946. Thus, an agency cannot find a

project categorically exempt from CEQA even if it believes that

no different outcome would result after environmental review.

B. Judicial Review of Categorical Exemptions.

The Court’s consideration of whether the Commission

properly exempted a project from CEQA is a two-step process.

The first question is whether substantial evidence supports the

State Lands Commission’s determination that the project fits

with a particular exempt class. If not, which Appellants contend

that it does not in the first instance, the exemption fails. But if

this Court determines that it does, then this Court must decide

whether any applicable exceptions defeat the exemption.

We conclude that both prongs of section 21168.5's abuse of

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discretion standard apply on review of an agency's decision with

respect to the unusual circumstances exception. The

determination as to whether there are “unusual circumstances”

(Guidelines, § 15300.2, subd. (c)) is reviewed under section

21168.5's substantial evidence prong. However, an agency's

finding as to whether unusual circumstances give rise to “a

reasonable possibility that the activity will have a significant

effect on the environment” (Guidelines, § 15300.2, subd. (c)) is

reviewed to determine whether the agency, in applying the fair

argument standard, “proceeded in [the] manner required by

law.” (§ 21168.5; Friends of “B” Street, supra, 106 Cal.App.3d at

p. 1002, 165 Cal.Rptr. 514.)

When unusual circumstances are established, as the trial

court concluded so in this case, “the Secretary’s findings as to the

typical environmental effects of projects in an exempt category

no longer control. Because there has been no prior review of the

effects of unusual circumstances, the policy considerations [we]

discussed in No Oil apply. An agency must evaluate potential

environmental effects under the fair argument standard, and

judicial review is limited to determining whether the agency

applied the standard “in [the] manner required by law.”

20

Berkeley Hillside, supra, 60 Cal.4th at 1116. The Commission

and the trial court in this instance failed to apply the “fair

argument” standard to determine whether or not an exception to

the exemption applies and instead applied a more rigorous

traditional substantial evidence standard.

VI. ARGUMENT.

VII. THE STATE LANDS COMMISSION HAD A DUTY TO FOLLOW THE TWO PRONG TEST SET FORTH BY THE SUPREME COURT IN BERKELEY HILLSIDE AND FAILED TO DO SO.

This case turns on whether there is an exemption for

Diablo from CEQA for its two seven-year lease extensions. There

are genuine questions about whether a nuclear power plant was

ever intended to fall within the exemption for existing

structures, and, if it was, whether the Secretary of Resources had

the authority to include a nuclear power plant within this

exemption. It is Appellant’s position that no exemption ever

existed for a nuclear power plant because the Secretary of

Resources never intended nuclear power plants to come within

the “existing structures” exemption, and even if the Secretary did

intend to include nuclear power generation facilities, then he

lacked statutory authority to include them.

21

Ad arguendo, even if a nuclear power plant like Diablo

comes within the exemption for existing structures, as is claimed

by PG&E and was held by the trial court, the inquiry is not over.

The next step is to consider whether there is an exception to that

exemption. Specifically, “A categorical exemption shall not be

used for an activity where there is a reasonable possibility that

the activity will have a significant effect on the environment due

to unusual circumstances.”6

The California Supreme Court, in Berkeley Hillside

Preservation v. City of Berkeley, (2015) 60 Cal. 4th 1086 has

provided a specific two-prong test for agencies like the State

Lands Commission to follow in instances such as this where

there is an issue whether there is an exception to the exemption

for existing structures.

The trial court in this case set forth this two-prong test

required by the Berkeley Hillside case which first requires a

showing that there are “unusual circumstances,” and secondly,

“whether there is a fair argument of a reasonable possibility of a

significant environmental effect due to those unusual

6 (CEQA Guidelines §15300.2(c).

22

circumstances.” The trial court explained what must be done

when there are “unusual circumstances,” as the trial court found

there were in this case:

If unusual circumstances are found under this first alternative, “agencies… apply the fair argument standard in determining whether ‘there is a reasonable possibility of a significant effect on the environment due to unusual circumstances.’ “Under this standard, ‘an agency is merely supposed to look to see if the record shows substantial evidence of a fair argument that there may be a significant effect. [Citations.] In other words, the agency is not to weigh the evidence to come to its own conclusion about whether there will be a significant effect. It is merely supposed to inquire, as a matter of law, whether the record reveals a fair argument…” (Judgment pgs. 25-27) (citing Walters v. City of Redondo Beach (2016) 1 Cal.App.5th 809, 819-820.

In this case, the State Lands Commission had a duty to apply

the Berkeley Hillside two-pronged test as part of its exemption

analysis. The statute and its implementing regulations, the CEQA

Guidelines, “prescribe review procedures a public agency must

follow before approving or carrying out certain projects.” Berkeley

Hillside, 60 Cal.App.4th at 1091-92. The Court in Berkeley Hillside

made it clear that the two-prong analysis was a procedure “a public

agency must follow.” Ibid.

Despite this directive from the Court, the State Lands

Commission completely failed to apply the two-prong analysis in

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Berkeley Hillside. Even though the Commission was applying an

exemption, and the Commission’s report specifically acknowledged

that the Commission needed “…to determine whether there is a

reasonable possibility that the issuance of the proposed limited-

term interim lease will have a significant effect on the

environment due to unusual circumstances…,” the Commission

never went on to determine whether there are “undue

circumstances” in this case, or if there is a “fair argument of a

reasonable possibility of a significant effect on the environment

due to those undue circumstances.”

In short, the Commission totally ignored its duty under

Berkeley Hillside, and issued a one paragraph summary that never

even discussed Berkeley Hillside. The Berkeley Hillside case is

never mentioned, and the Commission makes no finding as to

whether there are “unusual circumstances” in this case or whether

there is a “fair argument of a reasonable possibility of a significant

effect due to those unusual circumstances.”7 Instead, after a single

paragraph that never discusses the health issues, or many of the

other issues raised at the public hearings which comprise “unusual

7 Staff Report for Calendar Item 96, the report on the Diablo leases, 1 JA 41.

24

circumstances,” the report states and the Commission abruptly

concluded without explanation, that “The subject issuance of a new

lease is exempt from the requirements of CEQA as a categorically

exempt project.”8 Interestingly, even though the Commission

failed to assess the possibility of unusual circumstances, the trial

court found they did exist as noted below.

Acting in the aforementioned manner, the Commission

applied an exemption without making a factual evaluation as is

required by law. The Commission has a duty to make a “factual

evaluation” for each of the two prongs enunciated in Berkeley

Hillside. Save Our Big Trees v. City of Santa Cruz, 241 Cal.App.4th

694, 705 (citing Muzzy Ranch Co v. Solano County Airport Land

Use Com. (2007) (41 Cal.4th 372, 386)(“ a categorical exemption can

be relied on only if a factual evaluation of the agency’s proposed

activity reveals that it applies.”) In the case at hand, the State

Lands Commission utterly failed to make the required “factual

evaluation.”

It is understandable why the report and the Commission

refused to make an unusual circumstances analysis. There is no

8 Staff Report for Calendar Item 96, the report on the Diablo leases, 1 JA 46.

25

doubt that there are unusual circumstances in this case. The

trial court recognized that the Commission failed to decide

whether there are unusual circumstances, and held the

Commission did not have substantial evidence to conclude there

were no “unusual circumstances.” The trial court then

specifically found that there are unusual circumstances in this

case. (Court’s final order 12 JA 2911-12, 2919).

The trial court was correct in its determination that there

are “unusual circumstances,” and at that juncture should have

sent the case back for the Commission to determine “whether there

is a reasonable possibility of a significant environmental effect due

to those unusual circumstances.” The Commission must make this

factual analysis because the Commission has the burden of

demonstrating that substantial evidence supports a factual finding

that the project falls within the exemption, and that there is no

fair argument of a reasonable possibility of a significant effect on

the environment due to unusual circumstances. Save Our Big

Trees v. City of Santa Cruz, 241 Cal.App.4th 694, 705.

In Save Our Big Trees, the city of Santa Cruz claimed an

exemption from CEQA for the protection of heritage trees. The

trial court denied the writ of mandate challenging the application

26

of the exemption. The Court of Appeal reversed, holding that the

city of Santa Cruz had failed to meet its factual burden. The same

is true in this case, except even more obviously, as the State Lands

Commission did not even attempt to satisfy the two- prong of

Berkeley Hillside, but rather made no factual evaluation at all

whether “undue circumstances” or a “fair argument” exists.

The Commission’s excuse for not applying Berkeley

Hillside was that it applied a “baseline” argument that

circumvented and blocked application of the two-prong analysis.

The Commission assumed, and the trial court accepted, that so

long as PG&E did not deviate from business as usual, and left

existing operations unchanged, then a significant effect, or even

the reasonable possibility of a significant effect, cannot exist.

According to the trial court’s judgement, even with its

finding that “unusual circumstances” existed, a “fair argument”

cannot be made because as long as “business as usual” remains

unchanged, there is not even a reasonable possibility that

evidence of new earthquake faults, increasing cancer and infant

mortality rates near the plant, accumulating “embrittlement” as

determined by the Nuclear Regulatory Commission, and a host

of other unusual circumstances, could have a significant effect on

27

the environment. The trial court, led astray by applying PG&E’s

so-called “baseline” theory, has erroneously eviscerated the

Berkeley Hillside case it cited as the law of the State of

California.

Even as the trial court applied the PG&E theory that

continuous operation without material change is sufficient to

negate the second prong of Berkeley Hillside and exempt the

plant under CEQA, the trial court did express some discomfort

and suggested that the appellate court might provide a better

way to harmonize the two-step approach of Berkeley Hillside

with a “baseline” analysis. At the hearing, Judge Strobel made

the following observation:

“I think that the biggest disconnect perhaps here is what is the baseline that we’re looking at to determine whether there is a record that there could be significant impacts. Petitioners argued that I should harmonize cases on unusual circumstances with baseline. That’s, in fact, what I did do. And we know the Court of Appeal has de novo review on that. So, if I did that wrong. I’m sure we’ll find that out.” (Reporter’s Transcript (“RT”) pp. 42:21-43:2)

What is most important for this appeal is that the

Commission, as a matter of law, could not simply refuse as it did

to make any analysis of “unusual circumstances” and “fair

argument.” There is no factual discussion of these two prongs in

28

the Commission report. The law needs to be upheld.

What happened here is that the law was pawned off for a

political deal. At first, the Commission members did not even

think that an exemption applied or that “continuing procedures”

were enough to negate CEQA. As Lt. Governor Gavin Newsom,

a Commission member, said at a public hearing:

“The question is, is this the site that it should operate with all of the questions, the seismic instability, questions that seem to arise every few years. Another fault is discovered; another fault is discovered; another question mark about its safety and its potential capacity to survive an earthquake. They would say that, when these new things happen as long as they’re operating the same way in baseline, you don’t even consider them. And that’s a mistake. That’s a crimp in the baseline.” (Public hearing, December 18, 2015, RT pp. 15-16)

Lt. Governor Newsom’s interpretation of the law was right

then, and it remains correct today. The PG&E baseline argument

unfortunately accepted by the trial court puts too big “a crimp in

the baseline.” It is a “crimp” so tight that it forecloses on the

Court’s duty to follow the Supreme Court analysis in Berkeley

Hillside.

Applying CEQA in this case does not prevent a political

deal with PG&E to shut down Diablo in 2025, which is when its

current license from the Nuclear Regulatory Commission will

29

expire on its face. All it means is that a political deal cannot be

used to circumvent the review requirements of CEQA. PG&E

already explained to the Court during oral argument that there

will be an environmental review as part of the decommissioning

process. (RT pp. 34:10-14) ( “… the lease proposal provides for a

mechanism to set forth the decommissioning procedure for

Diablo. Decommissioning necessarily has to go through full

CEQA analysis.”)

A decision to apply CEQA in this case will simply require

an acceleration of the environmental review process so policy

makers can decide what precautionary steps can, or should be

taken should such a process determine that women and children

are dying from radioactive exposures, or accumulated

embrittlement requires upgrades to plant structures in case

there is an earthquake within the next seven years.

The most egregious outcome of this case as it stands right

now is that PG&E has convinced the Court to circumvent CEQA

review and apply a “cross your fingers” test for the next seven

years. This approach clearly did not benefit the city and citizens

of San Bruno when gas lines blew up an entire neighborhood,

killing 14 people. In that extraordinary tragedy, PG&E was

30

convicted of five felonies for conducting business as usual, and

then lying about it.

This Appellate Court should not encourage or adopt this

“cross your fingers” test. The situation here is unlike San Bruno,

where failure resulted in death and destruction of one

community. In this case, the Diablo plant lies just north from

Santa Barbara and Los Angeles, with strong trade winds blowing

nearly every afternoon down along the coast to these cities. An

earthquake or a plant accident, leading to an airborne

radioactive release transmitted by these winds, would kill tens

of thousands of people, and, should emergency systems fail due

to embrittled plant infrastructure, the meltdown could be

catastrophic and impossible to stop.

As everyone knows, California is susceptible to

earthquakes and Diablo sits right next to several clearly

documented faults where pressure under the Earth’s crust builds

until there is “slip” and a resulting earthquake. Diablo sits in a

cluster of these faults, one of which runs approximately 1,000

feet from the reactor vessel. As these seismic pressures build

naturally and inevitably, a major quake is not a question of “if,”

but “when.”

31

When great calamities happen, people wonder “How could

this happen?” and “Why didn’t we see this coming and do

something to prevent it?” The worst and most common truth,

unfortunately, is that public institutions, such as corporations

and/or government agencies, prevented vital information from

surfacing that might have created proactive steps to avoid these

catastrophic events. This is the beauty of CEQA, which allows

the public to raise issues of public interest, and when there is

significant new information or a significant change of

circumstances, require a thorough scientific analysis to

accurately assess the situation. In this manner, some

catastrophes can be averted, and no one is left wondering how

PG&E was able to avoid preparing an initial EIR, and then

allowed to not prepare any subsequent EIRs if the plant

conducted “business as usual.”

This Court should issue an order instructing the

Commission that merely making a finding of “business as usual”

and then crossing fingers for seven years is insufficient. To this

end, there are two possible outcomes available to this Court: one,

remand the matter back to the Commission to make an analysis

32

of a “fair argument” based upon the trial court’s finding of

unusual circumstances in this case; and two, determine that

there is a “fair argument of a reasonable possibility of a

significant effect due to the unusual circumstances” the trial

court found to exist in this case, and therefore order that CEQA

procedures be followed, and an initial EIR completed. A review

of the “unusual circumstances” in this case shows that it would

be proper to determine that a “fair argument” exists and the

Commission is required to prepare and initial study to decide

whether to issue a negative declaration or prepare an EIR.

VIII. THERE IS A “FAIR ARGUMENT” OF A REASONABLE POSSIBILTY OF A SIGNIFICANT EFFECT ON THE ENVIRONMENT FROM THE UNUSUAL CIRCUMSTANCES IN THIS CASE AND AN INITIAL STUDY MUST BE PREPARED BY THE COMMISSION.

It is a legal question whether a “fair argument” can be

made and neither the trial court nor this Court defers to the

agency’s determination. Pocket Protectors v. City of Sacramento

(2004) 124 Cal.App. 4th 903, 930. (Judgment 32). In reviewing the

lower court’s ruling on a petition for traditional writ of mandate

in a CEQA case, an appellate court is not bound by the trial

court’s determination of law. Gentry v. City of Murrieta, (1995)

36 Cal.App. 4th 1359, 1375-1376 (“on appeal, the appellate court’s

33

task is the same as that of the trial court: that is, to review the

agency’s actions to determine whether the agency complied with

procedures required by law.” The appellate court reviews the

administrative record independently; the trial court’s

conclusions are not binding on it. San Joaquin Raptor Rescue

Center v. County of Stanislaus (1994) 27Cal.App4th 713, 722.

As we make the factual evaluation of a “fair argument”

based upon specific unusual circumstances, and also the

possibility of a “fair argument” from a combination of these

unusual circumstances, it is important to remember that the

Commission has the “burden of demonstrating” that substantial

evidence supports a factual finding of no “fair argument.” Muzzy

Ranch Co v. Solano County Airport Land Use Com. (2007)(41

Cal.4th 372, 386. Also, as the trial court pointed out in its

Judgment, “the agency is not to weigh the evidence to come to its

own conclusion about whether there will be a significant effect.

It is merely supposed to inquire, as a matter of law, whether the

record reveals a fair argument…” (Judgment pgs. 25-27) (citing

Walters v. City of Redondo Beach (2016) 1 Cal.App.5th 809, 819-

820.

With these principles in mind we turn to specific unusual

34

circumstances to see if a ‘fair argument” can be made that there

is a reasonable possibility of a significant environmental effect

due to those unusual circumstances.

A. There is a “Fair Argument” Based on Significant New Information About Earthquake Faults.

It is indisputable that significant new advances have been

made over the past 30 years with respect to the detection and

analysis of earthquake faults. Since its construction, seismic

studies have located Diablo within a web of fault lines and less

than a mile from the Shoreline fault discovered in 2008. This new

knowledge is certainly significant, and a map was presented to

the Court during oral argument at trial showing the close

proximity of the Shoreline fault to the Diablo plant. (RT pp. 12-

13).

The map, which was part of the administrative record, (AR

008218), further exposed the danger from the Shoreline fault

intersecting with the Hosgri fault, potentially generating a 7.7

quake that would exceed Diablo’s maximum seismic capacity of

7.5 even if no embrittlement existed. There is also an ongoing

controversy over whether Diablo is in current compliance with

its licensed seismic design basis, the so-called Double Design

35

Earthquake ("DDE"). As the NRC has acknowledged since 2012,

"using the DDE as the basis of comparison will most likely result

in the Shoreline fault and the Hosgri fault earthquake being

reported as having greater ground motion than the plant's Safe

Shutdown Earthquake."9

The trial court’s treatment of the danger from the

combined effect of the two faults, and other seismic issues, was

to consider the controversy, but conclude that despite the

potentially significant consequences, since plant operations had

continued unchanged, the issue can be ignored as part of their

theoretical “baseline,” and a “fair argument” could not be shown

regarding a reasonable possibility of a significant adverse effect

on the environment from this serious vulnerability. Clearly, that

alone is reversible error.

By looking at the continuation of the existing procedures

at the plant rather than the significance of the new information

about the intersection of earthquake faults, the trial court erred.

The Commission's June 28th Staff Report considered the

controversy of the potential linkage of faults to create an

9 See, Letter to Edward D. Halpin from Joseph M. Sebrosky, NRC Senior

Project Manager for Plant Licensing Branch IV, Division of Operating Reactor Licensing, Office of Nuclear Reactor Regulation, October 12, 2012, 10 JA 2539-2544.

36

earthquake the plant could not withstand taking the side of

PG&E.

However, contrary conclusions are reached in the

Independent Peer Review Panel Report No. 7:

“The Shoreline fault is essentially a continuous feature from its intersection with the Hosgri fault . . . With respect to seismic hazard, this investigation has shown that effectively, there is a direct connection between the two fault zones, with the intersection located at a graben that is structurally controlled by the Hosgri and Point Buchon fault zones.”10

Given conflicting opinions, it is important to again consider

the standard for a “fair argument.” The administrative record

does not need to include proof of being right about the linkage of

the faults: “the agency is not to weigh the evidence to come to its

own conclusion about whether there will be a significant effect.

It is merely supposed to inquire, as a matter of law, whether the

record reveals a fair argument…” (Court’s Final Order, 12 JA

2912-14).

The record here raises a genuine dispute about whether

the Shoreline and Hosgri faults connect, and whether they are

capable of jointly rupturing, there can be no dispute that the

10 IPRP Report No. 7, “Comments on PG&E’s Central Coastal California

Seismic Imaging Project Report part 1: offshore seismic studies intended to reduce the uncertainty in seismic hazard at Diablo Canyon Power Plant,” November 21, 2014, pp. 14, 19-20, 8 JA 1851-1857.

37

Diablo plant sits atop the seismically most dangerous location in

the United States for a nuclear power plant. This is sufficient for

a “fair argument.” In a situation like this with such potentially

catastrophic consequences for numerous communities that could

suffer from radioactive fallout following an earthquake, science

presented as part of a CEQA review is intended to be the guide,

not a cursory, one-sided staff review.11

B. There is a “Fair Argument” Based on Significant Changed Circumstances Due to Embrittlement.

In 2013 the NRC identified Diablo Canyon's Unit 1 reactor

as the third-most embrittled reactor in the United States.12 The

type of reactors used at Diablo have, over time, experienced

significant generic, industry-wide problems. These generic

problems include steam generator corrosion, which ultimately

led to the unplanned closure of Diablos’ sister plant, San Onofre

in 2013. As with steam generator corrosion at San Onofre, which

led to a massive radiation leak threatening surrounding

11 In Citizens for East Shore Parks v. California State Lands Commission,

(2011) 202 Cal.App.4th 549, 555 136 Cal.Rptr.3d 162, 168, the State Lands Commission conceded that the great potential risk of oil spills precluded the application of an exemption for existing structures to oil facilities. Exactly the same analysis applies here, even more so, as the risk of radioactive “spills” is more egregious and long lasting.

12 Geesman Letter, 1 JA 59.

38

communities, reactor vessel embrittlement is an on-going

problem at Diablo.

An increase in embrittlement is a decrease in safety. When

a plant like Diablo is exposed to a stress-inducing event such as an

earthquake, embrittlement increases the likelihood that, in such

an emergency, the reactor vessel, which contains the nuclear fuel

rods, will rupture causing a catastrophic failure and major

radiation release. Furthermore, reactor embrittlement threatens

the integrity of the entire reactor pressure vessel, which can result

in a core meltdown and massive releases of radiation, such as

occurred at Chernobyl in 1986 and Fukushima in 2011.

The trial court in this case came close to recognizing that

embrittlement is not something that can be ignored by a finding of

“business as usual.” The trial court discussed the case Lighthouse

Field Beach Rescue v. City of Santa Cruz (2002) 131 Cal.App.4th

1170, 1196, where the court held that even when baseline is

applied, the court can still consider the increases and intensity of

the significant effects. (“…nothing in the baseline concept excuses

a lead agency from considering the potential environmental

impacts of increases in the intensity or rate of use that may result

from a project.)” Id. at 919

39

The trial court recognized that a worsening condition at

the Diablo plant due to embrittlement could reflect an increase

in intensity. The trial court stated in its ruling “… while the

operations are not expanding, one might hypothesize that the

age of a nuclear reactor might make it less efficient or less safe

when compared to baseline conditions.” (Court’s Final Order, 13

JA 2927) citing Lighthouse Field Beach Rescue v. City of Santa

Cruz (2002) 131 Cal.App.4th 1170, 1196-97.

Here the trial court came close to getting it right. The

worsening condition of a deteriorating plant cannot be swept

under the rug with the “business as usual” claim. Unfortunately,

the trial court then erred by concluding that the evidence of

embrittlement was not sufficient because there was no expert

testimony. This cannot be the factual requirement for a “fair

argument,” particularly in light of the NRC’s own

determinations on the subject. Often important issues are raised

that need expertise, but the people raising them lack funds for

an expert. This is precisely why showing a “fair argument” does

not have to prove a matter, but merely raise a reasonable

possibility of a significant effect. Here the Nuclear Regulatory

Commission’s own finding that Diablo is the third most

40

embrittled plant in the United States, is sufficient to certainly

warrant expert testimony, and that is precisely what the EIR

process is designed to do.

C. There Is a “Fair Argument” Based on Significant New Information About Cancer and Infant Mortality Around the Diablo Plant.

1. Increasing Rates of Cancer.

Some of the most striking new information over the past 30

years is the documented increase in the rates of cancer and infant

mortality. Even though the Commission staff had meetings with

the staff from the World Business Academy, and the

administrative record contains considerable information about

increasing cancer rates and increasing rates of infant mortality

including the proffer of peer reviewed epidemiological studies, the

Commission staff refused to even mention increasing cancer rates

and increases in infant mortality in the report, much less address

this new information.

The trial court made a cursory review of the health risks,

and the conflicting reports on health issues, and concluded that

“petitioners cite to no evidence that the lease replacement, which

does not modify the operations of DCPP, will result in an increase

in health risks from the baseline conditions.” (Court’s Final Order,

41

13 JA 2930). In other words, the trial court concluded that even if

the operations of Diablo were causing increases in cancer and

infant mortality, as long as those ongoing operations were not

changing, then the baseline prevented consideration of

information regarding increases of cancer that occurred over time

due to continuous exposure to Strontium-90, which accumulates in

human teeth and bone over its 29-year half-life. This was

reversible error.

The need for environmental review often becomes even

greater when there is controversy. Science is needed to resolve the

controversy, and issues should not be swept under the rug because

it is considered “business as usual.” The controversy over the

health issues is a good example. On the one hand, Petitioners have

submitted a scientific report and on the other, PG&E offers an

unscientific report with no peer review, unsupported by data, and

written anonymously by San Louis Obispo County staff.13

The County report is nothing more than a slipshod attempt

to refute, with loose rhetoric, the serious health concerns provided

13 The San Luis Obispo County Public Health Department’s

“Response to a Report on Health Concerns to Residences of San Luis Obispo County and Santa Barbara Counties due to Continued Operation of Diablo Canyon Nuclear Power Plant,” 7 JA 1720-1733.

42

in detail to the Commission regarding significant increases in

cancer and infant mortality rates. There are several reasons why

PG&E’s disingenuous reliance on this county report is

unpersuasive. First, this Report is not a “scientific peer review”

study, as claimed (3 JA 550). The Report contains no references to

articles, books, and other scientific publications to support its

claims; nor has it been published in a peer-reviewed scientific

journal. At best, it is nothing more than “an opinion” lacking in

supportive evidence or peer review; at worst, it is a biased attempt

to protect PG&E as the County’s largest employer.

By way of contrast, the 2014 Mangano Study, which the

County report purports to refute, contains 19 references, most of

them from journal articles, including 10 journal articles that found

high childhood cancer rates near nuclear plants (11 JA 2648-49).

The 2014 Mangano scientific study relied upon by Appellant is

titled “Report on Health Status of Residents in San Luis Obispo

and Santa Barbara Counties Living Near the Diablo Canyon

Reactors Located in Avila Beach, California” (1 JA 78-113). It was

carried out by Joseph Mangano, MPH, MBA, an epidemiologist

and author or coauthor of three books and 32 peer-reviewed

medical journal articles and letters to the editor on the topic of the

43

health hazards of radiation contamination. Mr. Mangano’s

research has been covered by the New York Times, USA Today,

CNN, NPR, and Fox News.

2. Increasing Rates of Infant Mortality.

In addition to documenting increasing rates of various types

of cancer in San Luis Obispo County, the 2014 Study (1 JA 78-113)

also found that “after Diablo Canyon began operating, infant

mortality in San Luis Obispo County rose significantly,” based on

California Public Health Department and U.S. Centers for Disease

Control (CDC) data. This conclusion compares the 1989-91 period

(approximately five years after the reactors began operating) with

2004-10 data, the last period for which infant mortality data was

available when the 2014 Study was being prepared. (1 JA 103).

Subsequently, at a March 14, 2016, meeting with

Commission staff, Academy representatives presented a power

point slide showing that, for the latest five years for which CDC

data was currently available (2010-2014), infant mortality rates in

SLO County were now “31.6% higher than the state rate/100,000”

(6 JA 1363). In a follow-up email of March 31, 2016, to Commission

staff member Cy Oggins, the Petitioner replied to Oggins’ request

for additional information by sending him an email that spells out

44

exactly how these increased rates of infant mortality had been

calculated (3 JA 608-609). Later, during the June 28, 2016,

Commission hearing, Academy President Rinaldo S. Brutoco again

reminded the Commission about the recent 2016 information

showing an increase in infant mortality and implored the

Commission to evaluate these findings as part of an EIR (5 JA

1019-20).

Evidence collected in 2016, and presented to staff before the

decision was made by the Commission, found that “A comparison

of official annual infant mortality data for ZIP coded areas near

Diablo Canyon nuclear plant adjacent to the seas with those inland

for the 25 years from 1989 to 2012 showed a remarkable and

statistically significant 28% overall increase in infant mortality

rates in the coast strip group relative to the inland control group.”

It is noteworthy that the State of California made the

compilation of this significant information possible because

California is the only state that maintains epidemiology data by

zip codes, thereby making it possible to compare zip codes of equal

distance from Diablo under the plume with zip codes adjacent to

them outside the plume. This zip code data is the critical piece

required in order for researchers to reach the study’s alarming

45

conclusions. It would be a travesty if, after State efforts to keep

precise data, the findings that result from analysis of do not meet

the “fair argument” prong. This type of information is precisely

what a “fair argument” is intended to bring forward.

The trial court, again at the urging of PG&E, also ignored

new significant health information documented in a separate peer-

reviewed journal article, showing significant declines in cancer

rates and infant deaths after the 1989 shutdown of the Rancho

Seco nuclear power plant in Sacramento County. This data can be

found in both the 2014 Study (11 JA 2646-47), and in slides 25

through 28 of Petitioner Academy’s PowerPoint presentation,

titled “Presentation to State Lands Commission on Public Health

Issues and Proposed Diablo Canyon CEQA Review,” which was

given to the Commission staff in person in Sacramento on March

14, 2016 (6 JA 1360-1363).

Given the scientific evidence properly presented to the

Commission, and now to this Court, the health issues, and the

public controversy surrounding them constitute a “fair argument”

and support a finding that an exception to the exemption exists.

46

D. There is a “Fair Argument” Based on Significant New Information and Significant Changed Circumstance Regarding Marine Life Near Diablo.

The Commission's own policy on the Once-Through

Cooling systems located at Diablo, observes that "once through

cooling significantly harms the environment by killing large

numbers of fish and other wildlife, larvae and eggs" and "also

significantly adversely affects marine, bay and estuarine

environments by raising the temperature of receiving waters,

and by killing and displacing wildlife and plant life . . . " 14, 15,,16,

17, 18, 19

Every day, Diablo’s cooling system takes in 2.5 billion

gallons of seawater, the equivalent of 3,788 Olympic-size

swimming pools. An estimated 1.5 billion fish eggs, marine

larvae and marine animals a year are swept along for the ride,

14 Resolution by the California State Lands Commission regarding Once-

Through Cooling in California Power [8 JA 1835-37]. 15 Miller, Peter, Senior Scientist, Natural Resources Defense Council

(NRDC), Transcript, Meeting, State Lands Commission, NRDC, June 28, 2016, p. 65 [5 JA 943].

16 Christie, Andrew, Director, Santa Lucia Chapter, Sierra Club, Transcript, Meeting, State Lands Commission, Sierra Club, June 28, 2016, pp. 128-130 [5 JA 1004-06].

17 Brown, Marty, Mothers for Peace, Transcript, Meeting, State Lands Commission, Mothers for Peace, June 28, 2016, pp. 151-152 [5 JA 1027-28].

18 Jencks, Michael, attorney, Biodiversity First, Transcript, Meeting, State Lands Commission, Biodiversity, June 28, 2016, pp. 167-169 [5 JA 1043-45].

19 “Resolution by the California State Lands Commission regarding Once-Through Cooling in California Power Plants, SLC, April 17, 2006, pp. 1-3 [AR 8 JA 1835-37].

47

and in the process churned, cooked and killed. Indeed, Diablo

currently represents 85% of all damage to our coastal

environment from coastal power plants. To date, over 45 billion

fish eggs and marine larvae have died during Diablo's 32-year

operational lifetime. Another seven years of operating Diablo

will increase the number of marine organisms killed by the plant

to nearly 60 billion deaths, clearly an "unusual circumstance"20

as the trial court correctly found.

Furthermore, Diablo is located less than a mile from the

Point Buchon Marine Protected Area ("MPA"). The MPA is

known for its biological diversity and is home to more than 700

species of invertebrates, as well as l20 fish species, marine

plants, seabirds, and marine mammals. Over time, Diablo has

seriously diminished California's marine populations as well as

reduced the oceanic food supply. The cumulative, potentially

exponential, impacts from seven more years of plant operations

supports a “fair argument” of a significant effect supporting a

comprehensive environmental review under CEQA.21 These are

20 TENERA Environmental, Report Supplement: Length-Specific

Probabilities of Screen Entrainment of Larval Fishes Based on Head Capsule Measurements (In DFPP Site-Specific Estimates, October 29, 2013, pp 1-22 plus appendixes [8 JA 1778-1834].

21 PG&E, Application for Land Lease, Amended Application, Attachment D, Project Description, January 20, 2015, pp. 2-1 to 2-18 [6 JA 1190-1209].

48

not minor impacts. According to the Alliance for Nuclear

Responsibility's ("A4NR") Attorney, John Geesman:

“By simple arithmetic, the extended period of time of the new lease will enable a 21% increase in the creation of nuclear fuel (aka radioactive waste) and a 21% increase in damage to marine organisms.”22

The new PG&E lease would also affect the habitat of at least

6 endangered species.23 Since there was never an environmental

review under CEQA, either at the original licensing of Diablo or at

the Commission's previous issuance of land leases, there has never

been a formal regulatory consideration of Diablo's impact on

tidelands as an endangered species habitat. The existence of this

endangered species habitat in the immediate vicinity of Diablo is

yet another instance of a “fair argument” of a reasonable

possibility of significant effect due to "unusual circumstances."

There is also cause for concern regarding adverse

environmental impacts resulting from operation of Diablo's

desalination plant which, like the nuclear plant, has never before

22 Geesman, John L., Attorney of Alliance for Nuclear Responsibility, Letter

to The Honorable Betty T. Yee, State Controller and Chair, SLC, June 27, 2016, pp. 1-2 [1 JA 59-64].

23 Christie, Andrew, Director, Santa Lucia Chapter, Sierra Club, Transcript, Meeting, State Lands Commission, Sierra Club, June 28, 2016, pp. 128-130 [5 JA 1004-06].

49

been assessed within the context of an EIR under CEQA.24 The

desalination plant was installed as part of the 1985 license to

operate Diablo25 without specific review by any State authority,

and discharges toxic chemicals and brine into the cove, which is

designated as an endangered species habitat. The desalination

facility was not mentioned in the original leases, and its existence

is an example of yet another significant changed circumstance that

will have a significant effect on the environment that was

overlooked by the trial court because it was part of a theoretical

“baseline” of continuing operations.

The cumulative impacts from the non-reproduction of 1.5

billion fish and invertebrates a year adds up to tens of billions of

lost marine life over the past 30 years. Moreover, cumulative

effects from water overheating, ocean acidification, radiation,

and heavy metals being discharged into the cove were never part

of any baseline study of Diablo’s potential adverse impacts.

Taken together, all of the foregoing cumulative adverse

impacts on marine life that will result from continued operation

under the Diablo lease for the next seven years constitute a "fair

24 Seeley, Linda, Mothers for Peace, Transcript, Meeting, State Lands Commission,

Mothers for Peace, June 28, 2016, pp. 147-148 [5 JA 1023-24]. 25 “Diablo desal project moving forward,” Santa Maria Times, March 23, 2016, pp. 1-3

[6 JA 1367-69].

50

argument" that creates an exception: CEQA applies.

E. There is a “Fair Argument” based upon Significant Changed Circumstances with Respect to the Size of the Diablo Plant.

The trial court concluded that the significant size of the

Diablo plant constituted an unusual circumstance. (Court’s Final

Order 12 JA 2912) This was indisputable given that Diablo is

located on 900 acres west of Avila Beach, California. The power

generation portion of the plant is 12 acres with two nuclear

reactors. There are also large water intake structures and

numerous other facilities spanning both on and off shore. In

accordance with Berkeley Hillside, this massive size constitutes

an “unusual circumstance” and supports a “fair argument” that

creates an exception to the exemption.

F. There is a “Fair Argument” Based on Significant New Information Regarding Tsunamis.

Even though the staff and Commission failed to consider

(or simply ignored) evidence of tsunami risks, these risks raise a

“fair argument” based on significant new information following

the Fukushima disaster. We now know that the Fukushima

disaster was caused by a tsunami generated by an earthquake

from a subduction fault that ran parallel to the shore. A similar

51

type of subduction fault line runs parallel to Diablo as well and,

with further study it has been determined that tsunamis have

hit that precise portion of the California coast in centuries past.

This risk was not even contemplated when Diablo began

operations.

In the case of Diablo, the water intake structures are

located within the area subject to PG&E's leases, and the

vulnerability of these intake structures to a tsunami (they could

be overwhelmed and sustain a catastrophic failure), coupled with

rising ocean levels,26 could lead to and exacerbate other

dangerous circumstances. The risk of tsunamis constitutes

further evidence of a “fair argument” that supports and exception

to the exemption and the application of CEQA.

G. There is a “Fair Argument” Based on Significant New Information Regarding Risks from Both Cyber and Physical Attacks.

Wherever nuclear fuels are produced, transported, and

consumed, and wherever high-level nuclear wastes are

accumulated there is a risk of a terror attack.27 Terrorists could

26 Diablo Canyon Power Plant Units 1 and 2 Flood Hazard Reevaluation

Report (March 2015), Enclosure 1, Table 3-17 and 3-18 [9 JA 2152-53]. 27 Congressional Research Service, Nuclear Power Plants: Vulnerability to Terrorist Attack, CRS Report for Congress RS21131 (Updated February 4, 2005), [2 JA 398-404].

52

also target nuclear power plants, digitally or physically, in an

attempt to release radioactive contamination into adjacent

communities.

The United States 9/11 Commission has said that nuclear

power plants were potential targets originally considered for the

September 11, 2001 attacks (in fact, the primary back up to

attacking the World Trade Center was a nuclear plant near the

New York metropolitan area).28 If terrorist groups could

sufficiently damage cooling and/or safety systems to cause a core

meltdown at a nuclear power plant, and/or sufficiently damage

spent fuel pools (with electronic sabotage or a “dive bombing” small

plane), such an attack could lead to widespread radioactive

contamination. This includes radioactive contamination due to

spent fuel fires or leaks, which has already been the subject of a

Generic Environmental Impact Statement prepared by the NRC.29

If a meltdown resulting in large scale releases of

28 The 9/11 Commission Report: Final Report of the National Commission

on Terrorist Attacks Upon the United States. National Commission on Terrorist Attacks (Cosimo, Inc). July 30, 2010. ISBN 978-1- 61640-219-8 [2 JA 405-444].

29 U.S. Nuclear Regulatory Commission, Generic Environmental Impact Statement for Continued Storage of Spent Nuclear Fuel, Volume 1 and Volume 2, September 2014 [9 JA 2072]. “The GEIS contains several appendices that discuss specific topics of particular interest, including the two technical issues involved in the remand of New York v. NRC—spent fuel pool leaks and spent fuel pool fires” [9 JA 2072, para. 3].

53

radioactivity from the reactor core or the spent fuel waste pools

occurred at Diablo Canyon, many nearby residents would suffer

from acute radiation poisoning (short term) and cancer (long term).

In 1982, the Sandia National Laboratories submitted estimates to

Congress for each U.S. nuclear plant in the case of core meltdown.

The Sandia figures are known as CRAC-2 (Calculation of Reactor

Accident Consequences). Within 17.5 miles of Diablo Canyon,

22,000 acute radiation poisoning cases (10,000 fatal) would be

expected; and within 35 miles, 12,000 cancer deaths would occur.

Estimates would be dramatically larger today, since the San Luis

Obispo County population has nearly doubled since 1980.30 The

risk of terrorism unfortunately constitutes a new circumstance

supporting a “fair argument.”

H. There is a “Fair Argument” Based on Significant New Information and Significant Changed Circumstances Regarding Radioactive Waste.

Nuclear facilities create large amounts of low- and high-

level radioactive waste. High-level waste consists of spent

30 Sandia National Laboratories, Calculation of Reactor Accident

Consequences (CRAC-2) for U.S. Nuclear Power Plants, prepared for U.S. Congress, Subcommittee on Oversight and Investigations, Committee on Interior and Insular Affairs, cited in Report on Health Status of Residents in San Luis Obispo and Santa Barbara Counties Living Near the Diablo Canyon Reactors Located in Avila Beach, California, Academy, 3/14/14, p. 11 [13 JA 2626].

54

uranium fuel rods that can no longer be used for energy or

reprocessed into another element that can yield power. For up

to seven years, the high-level radioactive waste in the spent fuel

rods at Diablo Canyon are stored in spent fuel pools,31 which,

unlike the reactor core, are not protected by a containment

building, and are therefore more vulnerable to natural disasters,

such as earthquakes32 and tsunamis, as was the case at

Fukushima. For this reason, the California Energy Commission

stated in its 2013 Energy Policy Report that Diablo Canyon

should “[t]ransfer spent fuel to dry casks as expeditiously as

possible.”33

By 2025, there will be approximately 4,300 spent fuel

assemblies stored on site at Diablo Canyon.34 Low-level waste

consists largely of water and used equipment from the nuclear

31 Williams, Geisha, President, PG&E, Transcript, Meeting, State Lands

Commission, PG&E, June 28, 2016, p 75 [5 JA 951]. 32 Independent Peer Review Panel, Report No. 6, Site shear wave velocity at

Diablo Canyon: summary of available data and comments on analysis by PG&E for Diablo Canyon Power Plant, August 12, 2013, pp. 1-23 [8 JA 1838-87]; and Direct Testimony of Douglas H. Hamilton, Ph.D., Before the CPUC, Submitted by A4NR, February 10, 2012, pp. 1-54 [9 JA 2018-21]. Mr. Hamilton has more than 50 years of experience in engineering and seismic geology.

33 See, CEC, 2013 Integrated Energy Policy Report, as adopted January 15, 2014, pp. 170-171, in A4NR’s Opening Comments on ALJ’s Proposed Decision, July 8, 2014, p. 6 [8 JA 863].

34 Schumann, Klaus, San Luis Obispo Nuclear Waste Management Committee, Transcript, Meeting, State Lands Commission, June 28, 2016, pp. 180-181 [5 JA 1056-57].

55

facility in which power is being generated. Both types of waste are

highly toxic and may have to be stored onsite indefinitely. Should

waste not be stored adequately, radioactive substances could find

their way into ground water, or contaminate other valuable

resources or sites. In fact, the U.S. Nuclear Regulatory

Commission “Effluent Database for Nuclear Power Plants” ranks

Diablo Canyon among the top five U.S. power plants for releases of

each the following carcinogenic, radioactive nuclear fission

byproducts: airborne tritium, liquid fission and activation

products, and liquid tritium.35

Here we can see how evidence of cancer combines with

evidence of storage and containment of cancer causing

radioactive waste to cause a potentially significant

environmental effect supporting a “fair argument” that

precludes exemption from the CEQA process.

I. There is a “Fair Argument” Based on Significant Changed Circumstances Making Diablo the Sole Operating Nuclear Plant in California.

Diablo is the state’s only remaining nuclear power plant.

35 Table 6, U.S. Nuclear Plants with Greatest Emissions, Selected Types of

Radioactivity and Selected Years, in Curies, cited in Report on Health Status of Residents in San Luis Obispo and Santa Barbara Counties Living Near the Diablo Canyon Nuclear Reactors, March 3, 2014, p 14 [13 JA 2629].

56

The only other nuclear power plant that had been operating in

California in recent years, located at San Onofre, was initially

shut down due to a massive radiation “event” that occurred in

January 2012; and that plant was permanently designated as

“closed” in June 2013.

The June 24 Commission Staff Report refuses to even

acknowledge the changed circumstances that Diablo is the

state's only operating nuclear plant, and its sister San Onofre

was closed due to a spontaneous life-endangering radiation

release. In addition, Diablo’s nuclear fuel source and proximity

to fault lines distinguish it from all other power plants currently

in service in California.36

J. There is a “Fair Argument” Based on Significant Changed Circumstances Due to Criminal Charges against PG&E Resulting from the San Bruno Explosion.

PG&E's recent federal prosecution on safety-related and

agency obstruction felony counts is unprecedented for any utility

holder of an NRC operating license. PG&E has been found guilty

of operating certain of its facilities in a dangerous condition, with

36 Staff report for Calendar Item No. 83 (Feb. 9, 2016), p. 3, para. 3 [1 JA

119].

57

careless disregard for public health and well-being.37 This new

information supports a “fair argument” of skepticism that PG&E

will safely manage Diablo without the guidance provided by

CEQA review.

K. Each of the Ten Examples of “Fair Argument” is Sufficient for an Exception to the Exemption, and Considered in Combination, they Create an Overwhelming “Fair Argument” supporting an exception to the exemption.

As this Court can see from the evidence, in the 10 separate

instances supporting a “fair argument” showing of a reasonable

possibility of significant effect on the environment from the

“unusual circumstances” at Diablo, there is a compelling

argument that an exception to the CEQA exemption applies to

Diablo. Any of the ten would independently support the

application of an exception to the "existing structures"

exemption. Taking and applying the standard set forth in

Berkeley Hillside, such a conclusion is without doubt.

IX. THE APPLICATION OF A “BASELINE” DOES NOT NEGATE THAT THERE IS A “FAIR ARGUMENT”. Faced with overwhelming evidence of a “fair argument” if

37 United States of America v. Pacific Gas and Electric Company, USDC,

Northern District of California, Case No. CR14-0175-TEH. See also, Pacific Gas & Electric Co., Current Report on Form 8-K dated August 9, 2016.

58

a proper factual evaluation is made, PG&E has concocted a

“baseline” test for the trail court to apply that negates the

required evaluation of a “fair argument” in accord with Berkeley

Hillside.

As a starting point for this “baseline” analysis, given that no

Environmental Impact Report has ever been done for Diablo, PG&E

uses the time when Diablo was approved, over 30 years ago, as the

beginning for this so-called “baseline.” According to PG&E “All of

the purported risks and potential impacts Petitioners allege have

existed since DCPP began operation over 30 years ago.” (3 JA 543-

44).

As discussed above, in that 30-year record of new

information and changed circumstances, according to the

appalling reasoning of PG&E, as followed by the trial court, none

of this matters.

In support of this baseline analysis, PG&E rests heavily

upon the case of North Coast Rivers Alliance v. Westlands Water

Dist. (2014) 227 Cal.App.4th 832, a case that preceded the

Supreme Court’s decision in Berkeley Hillside. No case since the

decisions in North Coast or Berkeley Hillside has taken the

position that somehow a “baseline” supplants the two-pronged

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analysis of Berkeley Hillside. Nor is there any other reported

example of an agency like the State Lands Commission

concluding that a showing of continuing existing operations is

sufficient to circumvent the legally required factual evaluation

of a “fair argument” as required by Berkeley Hillside.

A close look at North Coast Rivers shows why it has never

been used in the manner that PG&E suggested, and the trial

court erred in following in this case. The facts of North Coast are

distinguishable and do not come close to extinguishing the

requirements of Berkeley Hillside.

First of all, in North Coast Rivers, the court noted that

prior to the two-year lease extension for water delivery that was

at issue in that case, an assessment under the National

Environmental Policy Act of 1969 (NEPA) had already been

done. North Coast Rivers 227 Cal.App.4th at 847. Although NEPA

and CEQA have their differences, they both require that genuine

science and public input are core to decision making.

Furthermore, when looking at the facts of North Coast

carefully, the reason for a series of two-year contract extensions

was because of the “Bureau’s failure to complete the required

environmental documentation.” North Coast Rivers 227

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Cal.App.4th at 839. So, the situation in North Coast was that

substantial environmental documentation had already been done,

and the preparation of additional environmental documentation

was underway. These facts are in stark contrast to the case at hand

where there has been no environmental documentation done by

way of an EIR, and there is no additional environmental

documentation underway.

Given the magnitude of work required for an EIR, it is

important that redundancy is avoided. In a case such as North

Coast, where there has been substantial environmental

documentation and more underway, there is a stronger argument

that is a continuance of existing procedure is sufficient. But North

Coast facts differ from the facts in this case, where there is no EIR

and an abundance of serious unusual circumstances.

Another dissimilarity with North Coast is that a seven-year

time period in the instant case, not two years as in North Coast,

and there is clear evidence of substantial adverse changes over the

existing span of 30-plus years. Health, embrittlement and marine

issues have all become more evident and progressively worse over

that time, and will continue to worsen and become more dangerous.

This is unlike the facts in North Coast which were steady and did

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not have the gravity of a reasonable possibility of significant effect

on the environment that you have in this case. In North Coast,

some fish stocks might suffer if there is not enough water. In the

case at hand, children and adults are dying from radiation effects;

billions of fish and sea life are being killed, thousands of spent fuel

rods of high-level radioactive waste, including plutonium that is

lethal for 200,000 years, are being stored on-site at Diablo, right

next to several communities; and tens of thousands could die from

an earthquake triggered by two intersecting faults, or even one

fault where the safety mechanisms fail because of embrittlement.

Different facts require different results, and North Coast is

distinguishable.

Another case heavily relied upon by PG&E, which also

preceded Berkeley Hillside and surely does not limit it, is Bloom v.

McGurk (1994) 26 Cal.App.4th 1307. North Coast considers Bloom

as the seminal “baseline” case for if there is “business as usual,”

then that is enough. The problem is that Bloom does not go nearly

as far as PG&E and the trial court in this case. First, the trial court

in Bloom held that there were no “unusual circumstances.” Bloom,

26 Cal.App4th at 1316. In this case, the trial court specifically held

62

that there are “unusual circumstances.” (Court’s Final Order, 12

JA 2911-12).

In addition, as in North Coast, the magnitude of the facts in

Bloom is much less than the facts in Diablo. Bloom involved an

incinerator burning waste, nothing near the magnitude of a

nuclear power generation plant. The court noted the following in

Bloom:

“…there are apparently no homes in the immediate vicinity, and IES’s operations are comparable to those of surrounding businesses. According to the record, ‘[i]mmediate neighboring land uses include truck body manufacture and repair, awning manufacture, lumberyard, container storage, warehousing, and a fire sprinkler manufacturer. Nearby uses include a petrochemical processing plant and glass making facility.’”

Considering a baseline of these similar operations, the court

concluded that there were no unusual circumstances. Conversely,

the case at hand involves a singularly unique nuclear power plant

located adjacent to a pristine marine ecosystem, nothing remotely

similar to truck repair and glass-making facilities. In addition,

unlike in Bloom, there are residential developments in close

proximity and residents are experiencing increased levels of cancer

and infant mortality. It is an unnatural leap to extend Bloom to

the facts in the case at hand.

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Another case upon which PG&E and the trial court rely upon

heavily, Citizens for East Shore Parks v. State Lands Com. (2011)

202 Cal.App. 4th 549, is not just distinguishable, but actually helps

support the argument that the court cannot just make sure

existing operations are “business as usual” and then ignore

significant new information or changed circumstances and not

make a “fair argument” analysis. The court in Citizens for East

Shore Parks held that even when existing operations are being

continued without change, future risks need to be considered when

deciding the application of CEQA.

Citizens for East Shore Parks involved marine shipping

terminals where tankers were coming and going in San Francisco

Bay. The court noted that “The Lands Commission concluded

future oil spills constituted a potentially significant environmental

impact, requiring analysis in an environmental impact report

(EIR).” Id. at 555. In other words, the baseline did not preclude

consideration of future oil spills. Similarly, even when a baseline

is applied in this case, it would not exclude the consideration of

potential radioactive releases from earthquakes, human error,

structural failure from gradual weakening, or a terrorist attack

when deciding whether an EIR is required. When these future

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risks are considered as part of a “fair argument” as they must be,

the outcome, as was the case in East Shore Parks, is that an EIR

will be required.

Once a proper factual evaluation of a “fair argument” is

done, it is clear that an exception to the existing structures

exemption applies and CEQA procedures must be followed.

X. THE SECRETARY OF RESOURCES DID NOT INTEND TO INCLUDE NUCLEAR POWER PLANTS WITHIN THE EXEMPTION FOR “EXISTING STRUCTURES” BECAUSE A NUCLEAR POWER PLANT INHERENTLY HAS A SIGNIFICANT EFFECT ON THE ENVIRONMENT, BUT IF THE SECRETARY DID INTEND TO INCLUDE NUCLEAR POWER PLANTS, THEN HE LACKED THE AUTHORITY TO DO SO.

A. The Secretary of Resources Did Not Intend to Include Nuclear Power Generation Plants Within the “Existing Structures” Exemption.

In Berkeley Hillside Preservation Council v. City of

Berkeley (2015) 60 Cal. 4th 1086, 343 P.3d 834, the California

Supreme Court crisply stated well-established law with respect

to the power of the Secretary of Resources to create classes of

exemptions to CEQA:

The guidelines prepared and adopted pursuant to Section 21083 shall include a list of classes of projects which have been determined not to have a significant effect on the environment and which shall be exempt from the provision of CEQA. In adopting the guidelines, the Secretary …shall make a finding

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that the list or classification of projects referred to in this section do not have a significant effect on the environment. (citing §21084 of the Resources Code, as added by Stats. 1972, ch. 1154. §1 pp. 2271. 2273. 60 Cal. 4th at 1101. (Emphasis added.)

Given the explicit requirement that the Secretary “shall

make a finding” that projects within an exemption “do not have

a significant effect on the environment,” the Secretary of

Resources cannot have intended to include nuclear power plants

within the exemption for “existing structures.” Diablo takes in

over 2,000,000,000 gallons of sea water each day (along with

much of the sea life in it) and runs it through the plant,

superheating it by 18 degrees and then injecting it back into the

ocean. This is just one of many examples of a significant effect.

A close reading of the applicable exemption from the State

CEQA Guidelines, at (CAC, Title 14) §15301(b) shows this lack

of intent to be true. §15301(b) reads: “Existing facilities of both

investor and publicly-owned utilities used to provide electric

power, natural gas, sewerage, or other public utility services.”

The trial court, following the statutory interpretation of

PG&E, stretched the language of §15301(b) beyond the intent of

the Secretary or common sense. PG&E claimed in its briefing

that “...the exemption expressly lists electric power generating

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facilities as a covered class of exempt existing facilities.” (Opp.

Brief, 3 JA 535:9-10); and then later claimed again that “Section

15301(b) directly calls out existing electricity generating

facilities as existing facilities to which the exemption applies.”

(Opp. Brief, 3 JA 536:27-537:2) (emphasis added).

However, PG&E was wrong and the trial court erred by

accepting and applying this analysis. The administrative history

of §15301(b) reflects that the Secretary was thinking of

transmission towers carrying lines and similar structures that

do not have a significant effect on the environment, not power

generating facilities like the core reactors and water intakes at

the nuclear plant. This is why §15301(b) was careful to refer to

existing structures “used to provide electric power” (emphasis

added), because existing transmission lines are the types of

facilities that the Secretary could legitimately place into a

categorical exemption, unlike a nuclear power generation plant

which could not reasonably or logically fit into that category.

Surprisingly, the trial court looked at the word “provide”

and concluded that it was the Secretary’s intent to apply the

exemption to the nuclear power plants despite the Legislatures

clear specific limitation on the Secretary’s authority and the

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California Supreme Court’s confirmation of the limitation on the

Secretary’s authority.

The trial court admitted the legislative history concerning

the meaning of the word “provide,” but then refused to consider

that legislative history deciding instead that the meaning of the

word “provide,” as used is subject to a literal translation based

upon its plain meaning. This was a mistake. It is clear from the

discussion that the meaning of “provide” is sufficiently

ambiguous that legislative history is helpful and should be

considered.

The administrative history for February 3, 1973, the date

of the adoption for regulations of the California Resources

Agency, signed by the Secretary of Resources, N.B. Livermore

Jr., shows the intent of the exemption was to apply to the

conveyance and distribution of electric power, not the generation

of it by a large nuclear power plant. (See Order Adopting

Regulations of the California Resources Agency, 12 JA 2660-

2671). As originally written, Article 8, Categorical Exemptions,

§15101(b) (which later became §15301(b) that the trial court

interpreted read as follows:

§ 15101(b) Existing facilities of both investor, and publicly

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owned utilities used to convey or distribute electric power,

natural gas, sewage, etc:

The only difference between §15101(b) and its successor

§15301(b) is that the words “convey or distribute” in §15101(b)

have been condensed into the simple word “provide” in §15301(b).

All the other wording is the same in the two Sections, and the

intent of the Secretary of Resources is the same: to apply to

facilities that provide for the distribution, not generation of

electricity.

A reading of the 2,395 pages of administrative history that

encompasses the regulations, including the categorical

exemptions, shows that §15101(b) was not even controversial. As

can be seen from a representative letter from the Department of

Planning for the City and County of San Francisco commenting

on the existing structures exemption, §15101(b), it was thought

to apply to “Replacements of utility lines and equipment in

existing locations…” (See Letter dated March 29, 1973, 12 JA

2673-2685).

After the guidelines containing exemptions were adopted

in February 1973, the Secretary of Resources then proposed

amendments to the guidelines on August 31, 1973. (See

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Proposed Amendments to Guidelines for Environmental Impact

Reports, 12 JA 2687-2705). This is when the words “convey and

distribute” were replaced with “provide.” The Secretary sent out

a letter (id.) encouraging public comment and announcing that

there would be two public hearings in Los Angeles and

Sacramento where oral comments could be made, and written

comments submitted.

There was broad public participation, yet no one, including

major environmental groups, spoke against the change from

“convey and distribute” to “provide.” In their minds, and the

mind of the Secretary, and based on the plain meaning of the

words, it was clear to all that the exemption applied to

transmission lines and the distribution of electricity. In the

Comments of the Environmental Defense Center and the Sierra

Club for example (12 JA 2707-2729), they looked specifically at

the amendment changing “convey and distribute” to “provide”

and replied, “No Comment.” They did not need to comment, as it

was clear to all that the amendment was not intended to be an

exemption for nuclear power plants per se. PG&E creatively

suggested and the trial court followed a unique, inaccurate

interpretation in this case.

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Whether the Secretary intended to include nuclear power

generation facilities within the existing structures exemption is

a question of law for this Court to be decided de novo. Save Our

Carmel River v. Monterey Peninsula Water Management Dist.

(2006) 141 Cal.App.4th 677, 694 (“Where the issue turns only on

an interpretation of the language of the Guidelines or the scope

of a particular CEQA exemption, presents ‘a question of law,

subject to de novo review by this court.”) Furthermore,

categorical exemptions must be construed narrowly in order to

afford the fullest possible environmental protection. Carmel

River, supra. (“Since a determination that a project falls within

a categorical exemption excuses any further compliance with

CEQA whatsoever, we must construe the exemptions narrowly

in order to afford the fullest possible environmental

protection.”)38

38 Citing Azusa Land Reclamation Co. v. Main San Gabriel Basin Watermaster (1997) 52 Cal.App.4th 1165, 1193; County of Amador v. El Dorado County Water Agency (1999) 76 Cal.App.4th 931, 966, 91 Cal.Rptr.2d 66; Dehne v. County of Santa Clara, (1981) 115 Cal.App.3d 827, 842, 171 Cal.Rptr. 753.) “[E]xemption categories are not to be expanded or broadened beyond the reasonable scope of their statutory language.” (Dehne v. County of Santa Clara, supra, at p. 842, 171 Cal.Rptr. 753; Mountain Lion Foundation v. Fish & Game Com. (1997) 16 Cal.4th 105, 125, 65 Cal.Rptr.2d 580, 939 P.2d 1280.) These rules ensure that in all but the clearest cases of categorical exemptions, a project will be subject to some level of environmental review.

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This Court should use its power of review to examine the

legislative history and conclude that the Secretary did not intend

to include nuclear power generation facilities within the Existing

Structures exemption. Once the Court concludes that the

Secretary did not intend to include nuclear power generating

plants to come within the existing structures exemption and,

therefore, an exemption does not apply, this Court’s analysis of

the issues presented could logically end here: an exemption does

not apply.

B. Even if the Secretary Intended Nuclear Plants to be Within the Exemption, such a Decision Would Be Invalid as an Abuse of Authority.

As discussed above, the Legislature was careful to limit the

authority of the Secretary to create exemptions from CEQA.

As the Supreme Court put it bluntly in Berkeley Hillside:

“No regulation is valid if its issuance exceeds the scope of the

enabling statute. The secretary is empowered to exempt only

those activities which do not have a significant effect on the

environment.” (citing Pub. Resources Code. §21084). Berkeley

Hillside, at 1107, citing Wildlife Alive v. Chickering (1976) 18

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Cal. 3d 190, 205-206, 132 Cal. Rptr. 377, 553 P. 2d 537.39 Given

this explicit limitation, the Secretary lacked the authority to

include nuclear power generation facilities within the existing

structures exemption regardless of intent.

The Supreme Court’s statutory interpretation of the

limitation on the authority of the Secretary fits perfectly with the

intent of the author of the legislation, John Knox. At first, the

Sierra Club objected to the Secretary of Resources being given

“carte blanche” to create exemptions. However, the bill passed

ultimately with no opposition from the Sierra Club, since the

statutory language was clarified that the Secretary was required

to make a finding of no significant effect on the environment in

order to create an exemption.

Legislative history and common sense reflect that nuclear

power generation facilities do not come within an exemption.

This is another ground upon which this Court should reverse

with instruction that the Commission apply CEQA and prepare

and initial study.

39 The concurrence in Berkeley reinforces this majority holding “[W]here

there is any reasonable possibility that a project or activity may have a significant effect on the environment, an exemption would be improper.” Berkeley at 1131, citing Chickering, supra, 18 Cal. 3rd at p. 206.

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XI. THE TRIAL COURT DID NOT PROPERLY APPLY THE PUBLIC TRUST DOCTRINE.

The staff report that the Commission relied upon in

reaching its June 28, 2016 decision on the Diablo lease stated

that Commission staff “recommends authorizing the subject

lease as it does not substantially interfere with public trust

needs and values, is in the best interests of the State, and is

otherwise consistent with the common law Public Trust

Doctrine.”40 The error is this decision, however, is that, as

discussed above, because an improper “baseline” was applied, the

staff never performed the “factual evaluation” that was

necessary to make a decision on public trust.

The court in Baykeeper v State Lands Commission (2015)

242 Cal.App4th 202, 242 specifically held that a CEQA analysis

alone is not automatically sufficient to satisfy public trust

obligations. “…the SLC did not implicitly consider its own

obligations under the public trust doctrine as part of its CEQA

review of this project.) Id. The same is true in the case at hand.

The staff did not make a CEQA “factual evaluation” in

compliance in Berkeley Hillside, and this failure to make a

40 Revised SLC Staff Report, Calendar Item 96, p. 14, Recommendation No.

3, 4 JA 688.

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factual evaluation also makes the public trust decision flawed

and subject to remand.

Had a proper factual evaluation been done under the

public trust doctrine, the cumulative environmental impacts

from the continued operation of Diablo, as discussed above,

would have been found to substantially interfere with both the

express and implied responsibilities imposed on the Commission

by the Public Trust Doctrine to protect the public interest related

to waterborne commerce, fisheries, recreation and most

importantly, habitat preservation.

In addition, since no EIR has ever been conducted

concerning all of the possible adverse environmental impacts of

the operation of Diablo, there are likely cumulative health,

environmental and other impacts associated with radioactive

emissions from, and long-term storage of radioactive waste at,

Diablo that have yet to be fully measured as part of a Public

Trust analysis.

Diablo’s once-through cooling system takes in over 2.5

billion gallons (7,600 acre-feet) of water per day and heats it by

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18 degrees F before discharging into the Pacific.41 The

geographic scope of the impact from Diablo is estimated to

average 46 square miles.42 Two Marine Protected Areas,

established in 1999, are in proximity to the SLC-managed public

lands. The taking of any living marine resources within a

protected area is forbidden.43 Diablo entrains (kills)

approximately 1.5 billion larval fish and over 30 billion

planktonic forms per year. 44 In 2003, the state Water Resources

Control Board and the Department of Fish and Game prepared

a cease and desist order for reactor discharges into the ocean

cove, concluding: “The question presented is whether the

degradation of the marine environment near Diablo is acceptable

to the DFG. Based on review of law and policies …the answer is

“No”.45 Failure to apply and follow the public trust doctrine is

another reason way this case should be reversed and remanded

41 Diablo Canyon Power Plant License Renewal Application, Appendix E, Environmental Report, at 4.2-6, http://www.nrc.gov/reactors/operating/licensing/renewal/applications/diablo-canyon/dcpp-er.pdf)

42 Findings Regarding Clean Water Act Section 316(b), Diablo Canyon Nuclear Power Plant NPDES Permit Order, Peter Raimondi, 2005.

43 CA Code of Regulations, Title 14, §632, §§ (b) (48). 44 Peter Raimondi, et al., July 27, 2005 45 id.

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so that a proper public trust assessment can be made.

XII. CONCLUSION.

For all the foregoing reasons, Appellant asks this Court to

do the following: (1) compel Respondent Commission to set aside

its decision dated June 28, 2016 on Calendar Item No. 96 (to

terminate Lease numbers 4307.1 and 4449.1, and to approve the

new lease requested by PG&E); (2) require Respondent

Commission to proceed with further CEQA compliance,

including preparation of an initial study and a determination of

whether further environmental review would require an EIR or

a mitigated negative declaration under CEQA, before

Respondent extends, re-issues or issues any new or existing lease

or leases to PG&E; and (3) enjoining Real Party in Interest,

PG&E, from any activity or operation under a new Diablo lease

unless and until Respondent complies with all applicable

California regulations and statutes, including CEQA, so as to